Oil retail-to-telecom major Reliance Industries, which will declare its March quarter results on April 18, is expected to deliver marginal increase in consolidated profit driven by retail and Jio businesses.
However, weak refining segment, lower throughput and stronger rupee may drag standalone earnings.
"We model RIL's consolidated net income to increase modestly by 1 percent QoQ to Rs 10,340 crore (EPS of Rs 17.4) in Q4FY19 led by an increase in EBITDA from Jio and retail, which will offset lower standalone contribution," Kotak said.
On a consolidated basis, Motilal Oswal expects Reliance to report 6 percent sequential growth in Q4 profit.
In case of standalone business, Kotak expects RIL to report 3 percent QoQ decline in net income at Rs 8,620 crore dragged by sharply lower refining margins, which will be partly mitigated by improvement in LLDPE, PVC and polyester margins.
Prabhudas Lilladher also expects standalone profit to fall 5 percent QoQ.
The gross refining margins (GRMs) for the quarter ended March 2019 are expected to decline due to sharp fall in spreads for gasoline & diesel, refinery shutdown (108 percent utilisation) and lower light-heavy crude differentials.
According to Motilal Oswal, refining throughput may decline 7 percent and gross refining margin may fall to $8 a barrel against $8.8 a barrel in Q3FY19.
Emkay expects RIL's GRM to be $8.2 a barrel, down 7 percent QoQ, while petchem earnings should see a 4-5 percent fall QoQ on weaker margins.
Key segments, which expect to drive growth for the company, are retail and telecom.
"Earnings of Retail and Jio should continue to grow at 8-10 percent QoQ. We expect 307 million subscribers and Rs 129 ARPU (average revenue per user) for Jio with Rs 4,500 crore EBITDA," Emkay said.
Kotak, which also assumes ARPU at Rs 129 per month, expects Jio's reported EBITDA (15 percent growth at Rs 4,655 crore) and net profits (25 percent growth at Rs 1,035 crore) to increase sharply QoQ supported by robust 32 million addition to subscriber base to 312 million by end-March 2019.
Key issues to watch for would be GRM, petrochemical margins, telecom subscribers and future capex.Disclaimer: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd.